TrustArc Blog

Harnessing location technology on the mobile platform

July 20, 2010

Part of an ongoing series on the mobile platform & privacy

By Janet Jaiswal Director of Enterprise BUTRUSTe

BACKGROUND

Most advanced mobile devices sold today come equipped with location-aware technology, capable of pinpointing users within 30 ft of their actual location. This technology has been harnessed by mobile applications in a variety of useful and innovative ways – from social apps that allow users to locate their friends when they’re out and about (like Foursquare) to photo apps that geo-tag pictures (like Hipstamatic). Location is yet one more way to target offers and advertisements to consumers and we’ve witnessed the substantial impact targeting can have: online ads based on a user’s browsing activities are more than twice as effective as non-targeted online ads. In summary, location-aware technology allows marketers to increase the relevance of their programs, enabling businesses to make the shoppers’ experience richer, more relevant and timely.

But location-aware mobile technology also comes with its challenges. The harms are real and businesses thinking about leveraging this technology would be wise to understand the risks and take appropriate precautions. Consumers are predictably wary about the implications of sharing their location information with online services and apps. A recent survey found that more than half of location-enabled mobile users are worried about a potential loss of privacy.

To successfully incorporate location-aware mobile technology into your products or services you need to provide consumers with privacy protections and assurances. Win their trust and you will win their business. Let’s take a look at the growing number of uses for location technology:

A. Localized content – Services such as MaxMind allow companies to look up a user’s location based on their IP address, allowing web sites to tailor their content to show “local” weather, news and offers. Other services such as Skyhook’s Loki services makes it easier for users to reveal their exact location to web sites allowing them to further tailor the services they display to their users.

B. Building loyalty – If you operate a physical store or venue then you can use location-aware mobile technology to build customer loyalty by rewarding customers who frequent your establishment(s). A growing number of mobile applications have sprung up in the last two years allowing customers to check-in to physical venues so store operators can reward them for their patronage, thereby expanding their base of repeat customers.

C. Targeted offers and advertisements – Location-aware mobile technology can create more contextually-relevant advertisements and offers. Imagine two consumers viewing identical discount offers for a restaurant, one, in a newspaper while riding the subway, and the other, on their mobile phone when walking within a block of the restaurant in question: who is more like likely to act on the offer?

D. Health – Intel, General Electric and others user using mobile technology to develop solutions that allows caregivers to monitor the movement of elderly people in their homes. If a patient becomes inactive, for example, the caregiver will be prompted to call or visit them improving the quality of care provided.

MITIGATING THE RISKS

Despite the promising benefits many users have significant privacy concerns surrounding location-aware mobile technology as shown in a study by researchers at Carnegie-Mellon. Users are concerned about:

Who is collecting their location data, how it is used, whom it can be shared with and how long it can be stored.

Being spammed by advertisements or offers based on their physical location.

Accidental or unintentional sharing of location data resulting in annoyance, embarrassment or danger to an individual’s safety.

Consumer concern over personal information collection and use by a product or service can lead to that product or service’s downfall. Consumer disturbance with the privacy implications of Facebook’s ill-fated Beacon advertising program resulted in the program’s termination and a $9.5 million court settlement. When it comes to one’s physical location, many consider this data especially sensitive and a company’s mistreatment of it could quickly result in the abandonment of the offending product or service.

Knowing someone’s location allows you to push contextually-relevant information to them – info about their nearby friends, advertisements for local businesses, sightseeing recommendations etc. But identifying relevant information can be challenging and even relevant information can be a problem when it’s pushed in excess. If consumers consider your use of location-aware mobile technology “spammy” they will simply tune out or drop your product or service altogether.

In the wrong hands an individual’s present or future location is dangerous information. Stalkers or thieves can use this data to directly harm individuals and their property. In a project meant to underscore the potential harm posed by freely shared location information a group of consumer advocates created a website – www.pleaserobme.com – that aggregated public Twitter users’ location information. The project gained considerable press coverage. Physical safety aside, many individuals do not want others like their co-workers, neighbors or even family at time too know where they are and the revelation of this information could lead to embarrassment or even the loss of a job or relationship.

These risks can be mitigated if a company employs location-aware mobile technology best practices:

1. Provide Transparency and Accountability – Privacy is not about locking information down, it’s about creating a trusted environment where your users can engage in information sharing at their discretion and according to their individual preferences. Providing your users with transparency and accountability fosters this trusted environment. Consumers want to know what’s going on behind the scenes with their information and they want to know that someone will be held accountable in the event of data misuse or compromise.

2. Provide choices – Choice means asking users permission to use their location information before you collect it. Don’t make your data processing practices opaque – it should be clear to consumers what’s happening with their data once they click “allow” or “submit”: provide them with short, clear and timely privacy notices. It also means ensuring that adequate consumer redress mechanisms exist for consumers who want to remove their location data from your databases. And finally, give your users expansive choice when it comes to sharing their location data – they should be able to share it with the world or only their most trusted friends if they so desire.

3. Use a trustmark – Users will reward you for your commitment to the aforementioned principles of transparency, accountability, and choice, but communicating this commitment is difficult. Consumers don’t often appreciate a well-crafted privacy policy. Digital trust marks can go a long way toward communicating your commitment to consumers and ensuring that you are rewarded for providing them with privacy protections and assurances. Users recognize that a website or application displaying an established trustmark like the TRUSTe Privacy seal has undergone rigorous vetting by an independent third party and is worthy of their trust. That’s why displaying an established trust mark can drive increased downloads, registrations and purchases for websites or applications who display them. Again: if you win their trust, you will win their business.

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Questions I have for readers of this post include: how do you feel abut the use of location-aware mobile technology by companies? And would you share your location data for more personalized services or exclusive discounts?

My next post will cover design considerations for mobile devices and how it affects what users read and understand.